Topic: Importance of Business Ethics

Control Business Malpractices: Business ethics directly influence the operations of the

business. It is the one which helps business in deciding what is wrong and what is right. These
ethics set certain rules and principles to be followed strictly by business, and their violation leads
to a penalty. Implementation of these principles ensures that business does not indulge in any
unfair practices like black marketing, providing misleading advertisement, frauds in measures
and weight, adulteration, etc. Through business, ethics works on providing better products to its
customers at reasonable prices.
Better Relation with Employees: Employees are an important part of the business and
necessary for the survival of the business. Business ethics ensures that business works for the
welfare of its employees working with it. The business should not only work for the achievement
of its objectives like profit maximization and higher growth but should also focus on peoples
working with it. These ethics ensures that business provides better monetary compensation and
good working conditions to its employees, active participation in decision making, addressing
complaints, and providing promotions as per their progress. This helps in maintaining a good
relationship with employees.
Improves Customer Satisfaction: The consumer is termed as king in the market and is the one
who decides the success or failure of every business. It is important that the business fulfills the
needs of its customers. Business ethics provides principles for business operations under which it
is required to provide better quality products at reasonable prices. It ensures that the business
provides better customer support and redressal of all complaints. This helps businesses in
improving the satisfaction levels of its customers.
Increase Profitability: Business ethics improve the productivity and profitability of every
business. It sets certain rules to be followed by every person working with the business. Every
employee is required to adhere to these rules and should focus on its duties with sincerity. These
ethics ensure that there is no wastage of resources, and every resource is efficiently utilized. This
eventually leads to an increase in business profit in the long run.
Improves Business Goodwill: Business goodwill has an important effect on capturing the
market. Better goodwill businesses are able to attract more and more customers. By
implementing ethics in its operations business aims at providing better service to the market.
Businesses that work ethically operate at the low-profit base and with honesty. This develops a
better image in front of the public and is easily accepted by customers with fewer efforts.
Better Decision Making: Ethics in business helps them in making better decisions timely. It
provides certain rules and guidelines that every business needs to follow in its operations. Every
decision is taken in light of the moral principles and social values provide through these ethics. It
helps businesses in deciding what is right and what is wrong. Every person working within the
business is required to respect these ethics, violation of which would lead to the penalty.
Protection of Society: Society is very important for the success of every business. If a business
does not consider the interests of its society, then it will harm its survival. Business ethics direct
that business should work for the welfare of its society and take part in various infrastructural
development programs.
It ensures that business contributes actively to its corporate social responsibility. A business
should not perform any activity that creates a problem for the society in which business exists.
Protect consumer rights: Business ethics ensures that customers are treated fairly and provided
with their full rights. Organizations that implement ethics operates economically and provide
better quality goods at lower cost. They serve customers at a reasonable profit without exploiting
them. Customers are fully satisfied with services that makes them loyal to such businesses for a
long term.
Enhance relations with society: Relationship with society is must for survival of every business
organization. Ethics directs business to consider the interest of society and work for their
welfare. It should not focus only on its growth at the cost of exploitation of society. Business
should actively participate in corporate social responsibility and should contribute towards
infrastructural development programmes for its society.
Safeguard interest of industry: Business ethics protects the small scale business from
exploitation by large firms in an industry. It provides them full rights to operate efficiently and
establish their position in market. Following of ethics in an industry ensures that all firms works
fairly without the exploitation of other players in market.
Improve business goodwill: Ethics play a key role in enhancing the overall image of business in
market. It monitors all operations of business and avoids any unethical activities. Practicing of
ethics maintains the legality of business thereby providing better service to customers. All unfair
trade activities are controlled and quality goods are delivered. Customers are happy with the
services which leads to create a positive image of company.
Assist in decision making: Supporting in decision making of organization is an important
function played by business ethics. Ethics provides rules and guidelines to be followed by
business in its functioning. All decisions are taken in light of moral and social values mentioned
in these ethics. It guides in deciding what is right or wrong for business organization. Every ethic
need to be practiced properly and any violation will lead to penalty.